A deficit of trust: the paralysing effect of euroscepticism on improving the EU

According to the Eurobarometer of 2012 the public opinion about the EU as a contributor to the national interests of the member states has gone down from an all-time high in 2007 (52% view EU positively) to an all-time low in 2012 (31% view EU positively).Euroscepticism is nothing new; it is as old as the European integration project itself. It can take many forms, but is primarily understood as the agitation against the integration process in which sovereignty is increasingly conferred upon a supranational European framework that is accused of lacked democratic accountability.

However, in 2008 the eurocrisis unfolded after the effects of the economic crisis in the US spilled over to the Eurozone. It quickly appeared that the eurozone was not prepared to control this crisis decisively. The consequences of this economic crisis are the driving force behind the current wave of euroscepticism that is washing through the EU.This article discusses this relatively new phenomenon and its consequences on the basis of Karl Popper’s ideas on the Open Society and its Enemies. It is by no means our intention to expound on this theory extensively;we will therefore stick to Popper’s main arguments and refrain from explaining the paradoxes and criticisms on his theory.

POPPER’s OPEN SOCIETY

In a nutshell, Karl Popper’s theory rests on the indeterminist idea that knowledge grows, but that the full truth can never be held. Our conception of the truth is always incomplete; it stands firm until proven wrong. And because it is humanly impossible to fully understand the world around us, historical and current events can never be extrapolated into the future; the future can never be predicted because events can have unforeseen impacts. This is also Popper’s criticism on what he calls ‘historicism’: the effort to learn lessons from history by trying to convert them in axioms for the future (as is the case with Marxism, for example).

Knowledge growths, albeit slowly, through ‘trial and error’: action and reaction, adjustment and improvement – it is a never-ending process. Popper refers to this process as ‘piecemeal social engineering’.Put in a sociological and political context, social reform and political improvement is a continuous process too. The development of the ideal society is a never-ending construct. In order to give free rein to these forces of trial and error a level playing field is needed. This can only be provided by an open society because it allows for the practice of, and competition between, norms and values. In short: nobody has a monopoly on the truth, and societies can only prosper through institutionalised means to accommodate different views and interests in a peaceful way. The next steps of societal and political development are to be determined through discussion. As a result, piecemeal engineering promotes peaceful reform and social stability. This mechanism of ‘reasoned change’ is imprinted in the very DNA of every liberal democracy.

All of the EU member states are liberal democracies and therefore have open societies.We have opened our societies not only to provide a level playing field to the democratic forces of reasoned change, but we also opened our states towards each other in the knowledge that in our age of globalisation a single European market and a common currency can provide a safeguard for maintaining our standard of welfare and prosperity.

However, the ALDE’s (Alliance of Liberals and Democrats for Europe) nominee for President of the European Commission, Guy Verhofstadt, warns for the creeping processes that threaten to turn open societies into closed ones. Vast societal changes, such as the economic crisis, are one such phenomena that could make a society turn inwards. The EU-wide rise in Euroscepticism and the declining levels of trust in the EU reveals that the European societies are becoming less open.

THE TRUST DEFICITS

The current upsurge in euroscepticism is the expression of widespread discontentment with the EU’s struggle to control and solve the crisis. What lies beneath this expression of dissatisfaction is a trust deficit that appears on two levels and which reflects on the EU. First of all, there is the lack of trust that exists between the member states themselves. As the eurocrisis unfolded, a divide emerged between the Eurozone’s core (creditor countries such as Germany and the Netherlands) and periphery (debtor countries such as Portugal and Greece) economies. As the ECFR’s report ‘The continent-wide rise of euroscepticism’ explains, the first group feels that because the EMU’s control mechanisms were inadequate, they have to pay the price for the financial mismanagement of southern economies (most particularly, Greece). The latter are dissatisfied with the strong voice of core economies (especially Germany) within the EU institutions in setting the rules for the support to the destitute economies. Both debtors and creditors feel victimised in the crisis.As the blame game continues between the core and periphery, the EU receives a large portion of the blame too for either being too soft or having failed in its role as monitor of national economic polies, or on the other hand for the perception of representing the interests of certain member states only.

Secondly, as Diego Muro and Guillem Vidal Lorda point out in their article on the website of the London School of Economics, there is a lack of popular trust in national and international political institutions. Their study of the levels of trust among citizens from EU countries based on data from the Eurobarometers of the past years, demonstrates that mistrust in national governments and the EU is still rising (in the periphery economies), regardless of whether there was a legislative election or the colour of government changed. The researchers posit that there is a negative correlation between unemployment rates and trust in political institutions. Muro and Vidal Lorda argue that in line with theories of economic voting an electorate judges the incumbent government on its macroeconomic performances, especially if unemployment is prevalent. Hence, if an administration performs badly in this respect it will be voted out of office and the electorate would then place trust in a newly elected government. However, in the current situation electoral sanctioning has not helped citizens renew confidence in political institutions because both sides of the political spectrum appear unable to solve their country’s economic hardship. As Muro and Vidal Lorda state: “Bertrand Russell defined democracy as ‘the process by which people choose the man who’ll get the blame’. If citizens are unable to effectively identify those who deserve to be punished and elect credible alternatives, elections become irrelevant, and citizens develop political disaffection or mistrust against all political institutions.” Thus is follows that the popular disaffection with political institutions is not only focused against the national governments (who are the bringers of unpopular policy measures such as harsh austerity) but also against international political institutions such as the EU (which is held responsible for not being able to control the crisis).

Because these issues of mistrust occur within the realm of the monetary union, the sentiments of disenchantment naturally reflect on the EU – in the form of euroscepticism – because the problems take place at the international (i.e. European) level, but the harsh consequences of it are felt at the national level (i.e. by the citizens). The unprecedented level of prosperity that we have achieved in the past decades has been put under strain by the eurocrisis. Especially the carefully crafted attainments of the European welfare state – one of the biggest socio-economic achievements of the post-War years – are put at risk. The socio-economic consequences of the austerity measures – in order to comply with the Maastricht Treaty’s norms – are felt everywhere: pensions are cut, and education and public healthcare is becoming more expensive. Social security, which is still a national affair, and the national economies were put at risk by a crisis for which the EU was blamed.

Euroscepticism has kicked in to protect the national economies and welfare state from the external threats that the EU is believed to pose to its continued existence. Popper calls this phenomenon ‘tribalism’: the comforting feeling of knowing where we come from, where we stand and what we have. If a society’s tangible and intangible attainments are believed to be at risk, it reacts by adopting an inward-looking stance in order to protect the tribal roots. The norms and values of the group, which is often perceived or portrayed as relatively homogenous (as, for example, the concept of the nation state implies), are made the object of longing. The conformity with the group’s prevailing norms and values become an unrivalled standard of morality renders the society closed to the dynamism of reasoned change. Essentially, tribalism is a reactionary reflex driven by fear of erosion of one’s tribal roots.

THE MAASTRICHT TREATY’s PIECEMEAL ENGINEERING

As the champions of euroscepticism bash at the institutions of the EU and the euro, they tend to conveniently forget the fact that these institutions are the result of a series of political compromise in which all member states were involved. The euro’s institutional basis was flawed from the beginning: only an absolute minimum of competences were conferred upon the Union. As a result of that, the euro did not have the institutional ‘body’ to make it a lasting and durable common currency that could withstand the blows of an economic or financial crisis with vigour.

The reason for the euro’s insufficient institutional and legal foundation was that it was created more out of geopolitical rather than economic considerations. With the implosion of the Soviet Union and the impending German reunification, the balance of power was to rapidly change in Europe. In order to retain stability, the Western European leaders moved to integrate further so as to develop a capacity to deal with the suddenly liberated countries and to ensure that the new Germany would be ‘locked’ in to the economic integration process. With the introduction of the EMU only a minimum of competences was conferred upon the Union, for two reasons: it had set a sufficiently high threshold to maintain stability, and due to differing views and interests among the member states an agreement on further integration in other fields would be next to impossible to achieve at that stage.

This was no unusual approach to the European integration project. In his 2012 article in the New York Review of Books George Soros explains that “[the] process of integration was spearheaded by a small group of farsighted statesmen who practiced what Karl Popper called piecemeal social engineering. They recognized that perfection is unattainable; so they set limited objectives and firm timelines and then mobilized the political will for a small step forward knowing full well that when they achieved it, its inadequacy would become apparent and require a further step.”

He continues: “The Maastricht Treaty was fundamentally flawed. The architects of the euro recognized that it was an incomplete construct: it had a common central bank but it lacked a common treasury that could issue bonds that would be obligations of all the member states. […] The architects believed, however, that when the need arose, the political will could be generated to take the necessary steps toward a political union.”

Soros’s analysis is shared by Ruud Lubbers, who was the Dutch Prime Minister when the Maastricht Treaty was signed in 1992, who admidded that there were structural imbalances in the Treaty right from the beginning. WimKok, who was the Dutch Minister of Finance at the time, explained that there was a lack of effective and dynamic control in the Treaty – which is essential because the competitiveness of the eurozone’s member states differs vastly. In short, with the Maastricht Treaty an unfinished project was introduced. Being a political construct from the beginning on, it was believed that through the process of piecemeal engineering it would become the engine of its further completion and success in the future.

However, this was not to be. The Treaties of Amsterdam, Nice and Lisbon did not strengthen the institutional basis of the euro. Consequently, the national political leaders never equipped the EU with the necessary levers that would enable it to monitor the European economies and, more importantly, restrain the excrescences of globalization. Theproblems that the Eurozone is confronted with now are the product of our own unwillingness to make it a more stable and durable institution.

CONCLUSION

The Maastricht Treaty was flawed and incomplete from the moment it was drafted. Unfortunately, the subsequent treaties never expanded its institutional basis to grant sufficient competences to the EU to deal with economic crises effectively. As the eurocrisis unfolded, the Eurozone was brutally confronted with the fact that neither national government nor the EU could prevent the European economies from sliding down into a deep recession. Absent a clear centrally coordinating institution, the member states were left at each other’s mercy to deal with the crisis. Destitute periphery economies had to be saved by the core economies. At the same time the much-cherished attainments of the European welfare state were put at risk. This caused disillusionment among the civilians with their national political institutions but especially with the European cooperation project, which manifested itself in a pan-European rise in euroscepticism.Euroscepticism is a reactionary reflex against a problem that was caused by the political leaders of the member states themselves.

Euroscepticism closes European societies, effectively paralysing the ability to improve the EU. The way out is to make sure that the tribal roots of the member states are safeguarded. A major step in the right direction would be to start by safeguarding tangible attainments, such as in the realm of socio-economics: employment, income, social security, education, public healthcare, a decent standard of living.

The EU cannot compensate for the failures of the national democracies; it needs to be granted the necessary tools to address these issues decisively. The problems we face today are not only too large to handle for every individual member state, but, more importantly, they have been created by the member states themselves. Now is the time to get things right. But instead of having started a debate on how to improve the EU, it has become marred in debates about what is wrong with the EU and even whether competences should be withdrawn from it. It is a cynical development for a region that is one of the world’s protagonists of liberal democracy, which should therefore render it intrinsically inclined to the processes of piecemeal social engineering (trial-and-error) and reasoned change.

We have tried to make the common currency work with a minimum of institutions, but we failed. Now is the time to correct these mistakes. Retreating to the nation state, as championed by the eurosceptics, is futile and inept. Closing ourselves for the European project means straining the forces of self-improvement and, paradoxically enough, will only put the affordability of our socio-economic achievements further at risk. To put it more bluntly: it is in our national interest to make the EU more effective.